MADRID — If a few years back the buzzword at the GSM Mobile World Congress was mobile TV and how to incorporate the killer application into handheld terminals, this year’s wireless event seems far more about the transformative role mobile advertising is playing.
This annual confab returns to Barcelona this week with a new Mobile Ad Forum to spotlight the importance of the emergent sector. While mobile only comprises 1% of total ad spending today, it is expected to grow to 8% in a short time, blossoming from a $3.5 billion industry in 2010 to one worth $14 billion by 2015, according to Macquarie Equities Research.
A handful of trends are sweeping the sector:
-- Engaging campaigns employing technological advances enable advertisers to harness search-generated and location-based information to target ads more effectively, focusing less on consumers’ demographics and more on their behavior.
-- Advertisers understand mobile targeting better and are learning to read return on investment differently than just as a click-through measure.
-- Mobile operators are beginning to exploit their subscriber data to root themselves in the mobile advertising value chain and help deliver relevant ads.
-- Daily deal companies such as Groupon and LivingSocial are mushrooming.
-- Smartphone penetration, allowing increased rich media use, drives market growth
“Mobile advertising is informed by real-time data, which allow for very targeted, relevant advertising experiences in the unique places where those types of consumers can be reached,” said Eric Bader, worldwide chief strategy officer for Initiative, Interpublic Group’s media communications company.
Mobile searches — where consumers declare their intent through keywords they search on mobile devices — speak to immediate needs more than those conducted on PCs at home or work and give advertisers the opportunity to respond with highly localized, incentive-driven offers that reach people right when they are most likely to buy, according to Bader.
“Location-based services of course are incredibly compelling on mobile phones. Whether review-based, such as Qype or Yelp, or built around game dynamics such as Foursquare and Gowalla, consumers find great utility and engagement from such services,” said Rob Jonas, a vp and head of Europe and the Middle East for InMobi, one of the world’s largest independent ad firms. “The jury is still out on how advertising combines with these services, however, and 2011 should see that debate resolved.”
The future of mobile advertising, all agree, depends on accurate metrics and interpretations of success as action beyond the click through into actual sales, which are 100% measurable.
Some advertising networks now offer customers the ability to combine data from high footfall and high dwell locations with the ability to identify what mobile device a user is using to personalize a campaign experience via SMS, Bluetooth or wi-fi capability.
Said Michael Bayle, vp of monetization and marketing at Amobee, the world’s leading mobile ad platform: “By combining outdoor media with mobile, Amobee is offering brands the unique opportunity to accurately measure the effectiveness of their marketing spend.”
“If you are not capturing how effective your creative is, how this translates to your campaign objectives and what happens beyond-the-click, then you’re in danger of failing to understand the value your campaign has created,” Jonas added.
But networks also are aware of the “do not track” legislation the FCC is moving to enact in the U.S. and, as Bayle pointed out, need to navigate the “engaging vs. intruding” issue.
“Amobee is focused on helping our partners have active dialogues with their customers in seeking their demographic information in opt-in manners,” Bayle said. “Our push marketing has been successfully adopted by over a dozen operators who are using it to provide incentives to consumers in return for demographic data. Very transparent, very much the consumer in control.”
Other issues on the table at the Mobile Ad Forum will include the effectiveness of applications compared to websites; tapping social networks; how the rivalry between Google and Apple has fueled and legitimized the sector; mobile video; growth in regions dependent on mobiles for Internet access; and 3D campaigns on mobile units.
The GSM Mobile World Congress runs through Thursday.